Thanks to Trader Mike,The Kirkreport, Traderfeed, Daily Options Report, Afraid to Trade, and few others who linked to some of the posts in last couple of days, I spent couple of hours answering various questions. Now one kind of question which is often asked is what do you think of this or what do you think of what this particular person says on his blog or in article. Or people writing suggesting a writer or a blog which they are completely in awe of. All these kind of question relates to opinion or judgment. While to be successful trader what you need is method.
Opinions and judgments are all around us. The mass media thrives on that, lot of blogosphere is about it. While the primary focus for me to trade successfully is what is the method.
Method is something which you can break down in to steps. Method is something which you can replicate. Method is something you can practice and learn. Method is like driving direction. If the directions are clear and you have the right vehicle you will be able to travel from A to B.
The Dummy Trading is a method. You can break it down it to 10 to 20 steps and replicate it. Similarly you can replicate step by step the 100% plus strategy or IBD200 strategy. Methods are about regiments. Opinions create dependency, methods are about independence. You can replicate a method and trade it on your own.
You may or may not agree with the logic of a method and you may find different results with it, but ultimately it is a step by step replicable process.Methods are like those sick figures Ikea provides to put together the furniture you bought.
Opinions and judgments are unique to a person. They are about biases, misconception, ego, influence and seduction. How can you trade a opinion like "Bernanke is idiot" or " Greenspan screwed the country" or "Paper money is useless" or "US is doomed". Opinions are opinions, they are not tradable. They get you on to TV or get you quoted in Newspaper but they are perfectly useless for trading. Motivations of those who offer opinions is to influence you or seduce you not necessarily to offer tradable method.
When I visit a blog or read something on blog or interact with traders, I am primarily interested in learning what method does this person use. I have studied most of the trading blogs and made detail notes about methods and incorporated some in to my methods. Similarly when I am reading a book or come across an idea my primary focus is how do you make this work. How can I design a method to make this work. As Brett Steenbarger says trading is performance sports. Performance is all about methods.
Task for long weekend, draw Ikea style instruction about your trading method. If you can do it you have a method.....